Most back to work after China shoe factory strike

A nearly two-week strike at a huge shoe factory in southern China appears to have ended after the Taiwan-backed company agreed to meet some of the workers' demands, including raising their living allowance and benefit payments, AFP reports.

More than 80 percent of the employees at the Yue Yuen shoe factory in Dongguan city have returned to work, the company's chairman, Lu Chin-chu, said in a statement to the Hong Kong Stock Exchange late Friday.

He added that the strike had caused losses of about $27 million and that Yue Yuen's move to meet workers' demands "may have a material adverse effect" on its financial performance.

Tens of thousands of employees at the factory owned by Yue Yuen, which calls itself the world's largest branded footwear maker, had been on strike since April 14 in protest at unpaid social insurance payments.

Brands manufactured at the factory include Salomon, Nike, ASICS, Adidas and Under Armour, according to US-based China Labor Watch, although that could not be independently confirmed.

The move by Yue Yuen came on the heels of an order by China's Ministry of Human Resources and Social Security to address the workers' grievances after it found that the company had not properly submitted employees' social security payments.

In its Friday statement, Yue Yuen said it would provide employees with an additional living allowance of 230 yuan ($37) a month as well as additional benefit payments, a move it expects will cost it an additional $31 million this year.

China is facing labour unrest as its economic growth slows and as factories in its southern manufacturing heartland report a shortage of workers, prompting rising demands from staff.

The ruling Communist Party fears an independent labour movement could threaten its grip on power, so it only allows one government-linked trade union.

But activists say government officials have been more sympathetic to individual grievances against factories, especially those funded by foreign companies or overseas Chinese investors from Hong Kong or Taiwan.